If the Current Account Has a Negative Balance of $100

question 116

Multiple Choice

If the current account has a negative balance of $100 and the capital and financial account has a positive balance of $80, there will be ________ in official reserves of ________.

• A) a decrease; $20
• B) an increase; $20
• C) an increase; $180
• D) a decrease; $180

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Definitions:

Purchasing Power

The capacity of an individual or group to buy goods and services with a given amount of currency, influenced by inflation and economic conditions.

Imported Goods

Products or commodities that are brought into a country from abroad for sale.

Revenue

Revenue is the total income generated by a company or individual from their normal business operations or activities.

Italian Wine

Wine produced in Italy, known for its vast variety and quality, deeply rooted in the country's historical and cultural traditions.